Southern Africa: Slow but steady

The 25 biggest companies in Southern Africa are all South African firms, so we provide a separate Southern African table in order to examine firms from the rest of the region.

The biggest company by market capitalisation in our Southern African region is insurance firm Metropolitan, which is listed in both Namibia and South Africa, and which is valued at $1.2bn in our table. Second place is taken by First National Bank of Botswana, with $1bn, up from last year’s $906m.

The value of Namibia’s Paladin Energy has fallen from $830m to $631m over the past year, resulting in a drop from second to seventh in our table. The uranium producer is listed on the Australian Securities Exchange and the Toronto Stock Exchange, as well as the Namibian Stock Exchange.

Paladin also recorded a fall in profits from $30.3m in the nine months to the end of March last year to $28.9m for the same period this year. However, production increased by 33%, boosting sales revenue from $240m to $301m. Its future will depend heavily on the outcome of the crisis of confidence in the Asian nuclear industry.

There is a wide geographical spread of companies in our Southern African table: seven come from Zambia, six each from Namibia and Botswana, five from Zimbabwe and one from Malawi. However, Malawi has lost two entries over the past year: National Bank of Malawi and Telekom Networks Malawi. Their places have been taken by one firm each from Zambia and Namibia. Zimbabwean companies have maintained the improvement recorded last year but there is a very long way to go before the country becomes the powerhouse of African business that it was before 2000.

Nevertheless, the total market capitalisation of the 76 companies listed on the Zimbabwe Stock Exchange stood at around $6bn as African Business went to press, its highest level since dollarisation. Zimbabwe’s biggest listed company, Econet Wireless Zimbabwe, falls from 5^th to 6^th in our regional table, following a decline in value from $677m to $643m. The mobile telecoms operator hopes that its recent acquisition of TN Bank will boost income and profits. Econet already owned a 45% stake in TN Bank but now intends to promote saving and the EcoCash mobile money service following its full takeover. TN founder Tawanda Nyambirai exchanged his equity in the company in return for an equivalent value of Econet shares.

Econet Wireless founder Strive Masiyiwa said: “Those are the twin pillars on which we must build the future of Africa: savings and entrepreneurship by our young people. If we all saved just a dollar a month, Africa would have billions to invest in its own economy. Savings have been the key to China’s success. Chinese parents always save: we need to do the same, even from the little we have.” There are no companies from Angola and Mozambique in our Southern African top 25, surprising given their economic growth. Angola is the third-biggest economy in sub-Saharan Africa, but its GDP is concentrated in the oil and gas sector, dominated by foreign firms and state-owned Sonangol. Providing the oil revenues are invested well, they could help create a climate within which private sector companies could grow.

Mozambique is a much smaller economy but is set to grow rapidly through the development of coal and gas projects. Here too, the biggest private sector firms are too small to rank on our table and will require huge growth to secure a listing.

With the exception of North Africa, the value of non-South African Southern African companies has increased more slowly than those in any other part of Africa. The economies of Angola and Mozambique are expected to grow by at least 7% a year over the next few years but the rest of Southern Africa is not growing as quickly as competitors in East and West Africa.